ORIENTAL OVERSEAS MARITIME SERVICES LTD v. THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL "FAN YUN 123 (番運123)"

HCAJ265/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ADMIRALTY ACTION NO.265 OF 2005

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Admiralty action in rem against the ship or vessel
“Fan Yun 123 (番運123)” of Guangzhou port and
The People’s Republic of China flag
and the Vessels listed in Schedule II hereto

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J U D G M E N T

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1. I have before me a dispute which I need to resolve.  The matter before me is a motion by the defendant to set aside the Warrant of Arrest and the Writ on the basis that there is no admiralty jurisdiction in rem in respect of the plaintiff’s claim against the vessel.  Much would turn on whether factually in law it could be established that the claim arose out of an alleged charterer of the tug by the plaintiff to the defendant and that the defendant was at the time the cause of the action arose the charterer of the vessel.

2. There is some factual disagreement between the parties ─ the difficulty is caused by the paucity of positive evidence from the plaintiff and the fact that the person dealing with this matter in the form of Mr Fung Siu Kuen who was a director as well as a 50% shareholder had set up a different company, Yi Xing Shipping Company Limited, which got itself invlved in the use of the tug during the material time.  The difficulty had arisen as how to proceed with resolving the dispute as to the question of whether the defendant was the charterer. 

3. The matter came before me on 2 February 2006 and I gave directions for the filing of further affidavits, with a short adjournment so that the matter could come back to be argued and to be resolved.  The urgency was caused by the fact that the vessel was under arrest and the defendant was unable to provide security for its release.

4. There was no question at that time raised by Mr Chong on behalf of the plaintiff that the matter should be resolved by a trial of jurisdictional issues with pleadings, with discovery and with live witnesses, nor was cross-examination being sought.

5. Even today when Mr Wright for the defendant opened the case, there was no seeking of cross-examination by the plaintiff.  It is only as a result of the exchanges between the bench and counsel that perhaps the full flavour and implication of an alternative potential case of the plaintiff against Mr Fung and against the defendant slowly emerged and Mr Chong sought the assistance of the court to have the matter further  considered and not by simply a resolution on the basis of affidavits filed.

6. I think it is really too late now to take the course suggested by Mr Chong although I must say I confess that I have myself thrown the ball in the air and Mr Chong was very brave to catch the ball.  I think, in the circumstance, we just have to proceed with what we have.  The only consolation is possibly this, twofold :

(1)     Mr Chong on behalf of the plaintiff can always withdraw the arrest, keep his powder dry and then when he has got sufficient material he might wish to rearrest; and

(2)     if he has got a good case against Mr Fung even if he should go down tomorrow, he is still may be able to seek whatever may be the proper remedy from Mr Fung.

7. But I think so far as the in rem jurisdiction is concerned, I have no choice but to proceed with what we have now.